The ruling on gifting a property and retaining the right to live in it

Q: Husband (H) and wife (W) have two daughters. H and W wanted security for their daughters and the following was therefore proposed.

H & W gift the property to the daughters but reserve for themselves a right to live in the property for, say, twenty years or death of both H & W, whichever is earlier. On this basis H & W retain a right to live in the property but the daughters have ownership of the property. For Shariah purposes is the arrangement valid and is the gift to the daughters is complete?

الجواب حامدا ومصليا ومسلما ومنه الصدق والصواب

A: If the gifted property is occupied by the donee, his property, or a tenant, etc. the gift will be incomplete and the gifted property will remain the property of the donor.

This requires that the gifted property is not occupied by the property of the donor. This includes furniture, clothing and all other personal effects. Thus, executing a verbal offer and acceptance and handing over a set of keys, is not, of itself, sufficient to effect a valid gift. The property must also be vacant of the personal property of the parents.

However, one way to overcome this is for the donor to place his furniture, clothing and all other personal effects in to the safe keeping of the donee whilst allowing full access and then gift the property to the donee. If done in this manner, the gift will be valid as the furniture, clothing and all other personal effects are in the possession of the donee.

If the gift is validly concluded by the parents in the above manner and the daughters then subsequently agree to allow their parents to live in the home for 20 years for a nominal amount of £1, such an agreement will be valid.